Equities are recovering but stimulus issues persist

Recap: European and Asian stocks rallied yesterday, albeit in a cautious mood, as global investors continue to digest moves by major central banks to end the stimulus. Stocks in Asia edged up, driven by a 2% gain in the Hang Seng as Chinese gaming stocks rebounded, Beijing’s moves to dampen the sector may not be as tough as previously feared.

The SET index has evolved in a range of 1,620.58 and 1,658.08 points this week before closing yesterday at 1,635.35, down 0.91% compared to the previous week, for a figure of average daily business of 90.66 billion baht.

Foreign investors were net buyers of 4 billion baht and retail investors bought 889.4 million. Institutional investors were net sellers of 3.66 billion baht and brokers sold 1.23 billion baht of shares.

Current actors: The European Central Bank said on Thursday it would begin to scale back its massive monetary stimulus, slowing bond purchases from the current 80 billion euros per month.

  • Policymakers at the US Federal Reserve are looking at reducing bond purchases from October, and a clearer picture should emerge at their September 20-21 meeting.
  • The United States created far fewer jobs than expected in August as businesses grappled with the Delta wave of Covid, another complication for President Joe Biden’s plans to rebuild the world’s largest economy.
  • Tencent and Netease lost $ 60 billion on Thursday as investors increasingly fear Chinese regulators prepare to significantly tighten their grip on the world’s largest online gambling industry.
  • China’s recent crackdown on industries, including tech companies and the education sector, will not undermine its goal of opening up the economy, state media said on Wednesday, as Beijing was rushing to reassure shaken investors.
  • Chinese President Xi Jinping on Thursday announced the formation of a Beijing Stock Exchange with the aim of channeling investment to promising tech startups as the means to raise funds in the United States disappears.
  • Richard Liu, the billionaire founder of Chinese e-commerce giant JD.com, to retire from day-to-day operations, the company said, making him the latest A-list CEO to step out of the limelight as Beijing stifles the industry technological.
  • Beijing regulators are backing a China Evergrande proposal to renegotiate payment terms with creditors. The cash-strapped developer’s struggle to keep up with $ 300 billion in liabilities has spooked the markets.
  • Europe’s biggest banks have pledged to phase out funding for carbon dioxide emissions by 2050. But an activist group backed by big shareholders says lenders are not doing enough to meet their targets.
  • Climate change will help to triple property insurance premiums over the next two decades, according to a study published Monday by Swiss Re.
  • Embbattled Binance, one of the world’s largest cryptocurrency exchanges, said it would restrict its services to Singapore days after the city-state central bank told it to stop offering services of payment because she did not have the appropriate license.
  • El Salvador on Tuesday became the first country to introduce bitcoin as legal tender, but strong demand crashed its online e-wallet system on day one.
  • Sweden’s central bank governor likened buying and selling bitcoin to exchanging stamps, questioning the resilience of currencies without government backing. “Private money usually collapses sooner or later,” said Stefan Ingves.
  • The cabinet approved an additional 16.96 billion baht in relief funds for workers and businesses in maximum risk or dark red provinces affected by strict Covid restrictions.
  • Debt restructuring periods offered to borrowers affected by the pandemic could be extended to more than 10 years, according to the chairman of the Thai Bankers Association.
  • Industrial sentiment fell for a fifth consecutive month in August to a 16-month low, affected by the tightening of Covid restrictions and infections in factories, the Federation of Thai Industries (FTI) said on Wednesday.
  • Consumer confidence plunged to the lowest level in nearly 23 years in August thanks to strict government restrictions to contain the spread of Covid-19 in 29 provinces.
  • Government measures to lower the cost of living, the fall in the prices of certain agricultural products and the fall in energy prices led headline inflation to contract by 0.02% year on year in August, the first decline in five months.
  • The National Shippers Council has raised its export growth forecast to 12% this year, from 6 to 7% in May and 3 to 4% in December, aided by the global economic recovery and the return of economic activity among the main trading partners with a high vaccination rate.
  • The Ministry of Industry expects food exports in 2021 to increase 7.1% to 1.05 trillion baht in value despite the impact of Covid-19.
  • The Ministry of Tourism and Sports is committed to opening the whole country without quarantine by January of next year, but such a decision will largely depend on whether it is possible to obtain collective immunity across the board. national.
  • The government is pledging to distribute 124 million doses of Covid vaccine to people during this year, including those in Rayong and Chon Buri as they prepare to reopen to foreign visitors.
  • Amid lukewarm tourist demand, 52% of hotel operators plan to close temporarily, while 9% want to close permanently, according to industry sources.
  • Phuket businesses are urging the government to fully reopen the resort island by December 1, saying the move could bring in more than 210 billion baht in tourism-related revenue in just three months.
  • The Phuket Sandbox program generated revenues of 1.63 billion baht in its first two months, Governor Narong Woonciew said, citing a report from the Ministry of Tourism and Sports.
  • The Samui Plus program has generated nearly 40 million baht in revenue since its launch in mid-July, said Governor of Surat Thani, Witchawut Jinto.

Future : Australia will release key manufacturing conditions for the third quarter on Monday. China will release data on new loans, the United States will release August’s budget balance and consumer price figures on Tuesday. Japan will announce industrial production for July.

  • China will release August industrial production on Wednesday and Australia will release consumer confidence in September. The United States will release figures for export and import prices, industrial production and crude oil inventories in August.
  • Australia will release employment data for August on Thursday and the United States will release retail sales for August. Britain will release August retail sales on Friday and the Eurozone will release August consumer price figures.

Actions to watch out for: SCB Securities recommends the selective purchase of shares with two themes. For the main portfolio, he recommends defensive stocks with good earnings growth prospects in the second half of the year, namely BBL, BDMS, BEM, SPALI and GPSC. The second group is the reopening of stocks that are priced below pre-Covid levels, including AOT, CRC, ERW, M and ZEN, and stocks that benefit from a low baht like TU, KCE and HANA.

UOB Kay Hian Securities advises communications stocks and REITs to hedge against an expected downward revision in second half earnings forecasts. He recommends gradually accumulating ADVANC, DTAC, FTREIT and WHART, and utilities such as GULF, GPSC, EGCO, RATCH, EASTW, WHAUP and TTW. The recommended food stocks are TVO, TU, CPF, GFPT and TWPC. Speculative trading is also possible with shippers PSL, TTA and RCL.

Technical view: DBS Vickers Securities sees support at 1,600 and resistance at 1,650. Capital Nomura sees support at 1,604 and resistance at 1,643.

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